Hearing set on Spelter smelter settlement

CHARLESTON, W.Va. -- A Harrison County judge will consider today whether to approve a roughly $150 million settlement in which DuPont Co. agrees to pay to clean up contamination of the community of Spelter and fund a program to test residents for any illnesses the pollution might have caused.

Lawyers for about 8,500 residents will ask Circuit Judge Thomas A. Bedell to approve the deal, which would end a six-year-old, class-action lawsuit that prompted a nearly $400 million jury verdict in 2007.

If Bedell signs off, the settlement eliminates the need for another trial -- ordered by the state Supreme Court -- over whether the residents filed their original suit within the legal time limit. The settlement would also protect both sides from the risk, time and expense involved in further litigation, including likely appeals of that second trial's outcome.

"Assuming success at trial, the class would still face a long and difficult path of appellate procedure, including the very real possibility of scrutiny by a United States Supreme Court that appears intent on making substantial revisions to class-action law," attorneys for the residents argued in a brief asking Bedell to approve the deal.

But questions remain about the extent to which the settlement will clean up a legacy of pollution from a DuPont smelter, about the amount of the settlement going to the residents' lawyers and about how a settlement administrator will oversee the deal.

The Spelter site, just north of Clarksburg, was originally a DuPont gunpowder mill that opened in 1899. After that facility burned down, Grasselli chemical Co. built a zinc smelter and a company town. DuPont bought Graselli in 1928 and operated the smelter until 1950, when an internal report showed air-pollution control upgrades would cost $325,000.

In the late 1980s, federal environmental officials began investigate the site. DuPont got involved, eventually repurchased the smelter and steer the cleanup toward the state Department of Environmental Protection's voluntary program, rather than the more stringent federal Superfund program. Residents sued in 2004, alleging that the cleanup was inadequate and that the smelter's pollution put them at increased risk of getting sick.

A Harrison County jury awarded nearly $400 million for property cleanup, medical monitoring and punitive damages. The Supreme Court upheld most of the verdict, but cut the punitive damages and ordered a new trial on the statute of limitations issues.

Under the settlement announced last month, DuPont will pay $70 million and fund a 30-year medical monitoring program that is estimated to cost between $65 million and $90 million.

Of the $70 million payment, $4 million is set aside for cash payments for roughly 6,000 former and current residents who do not own property in the area. Some of that $4 million might also be used to kick-start the medical monitoring program, lawyers in the case have said.

The other $66 million payment is to fund property remediation in the area and to pay the lawyers who represented the residents in the case.

Plaintiffs' attorneys from six different law firms have asked Bedell to approve $30 million in legal fees and nearly $10 million in expenses, or a total of nearly $40 million.

Court records indicate that two families who are members of the class involved in the case have objected to the amount of money sought by the lawyers. On family, in a letter to Bedell, said they were "genuinely grateful to the attorneys who have given their time, energy and travel" for the case, but that the amount sought was "absurd."

In their petition seeking Bedell's approval for the fees and costs, the lawyers noted that the $30 million in fees is roughly 19 percent to 22 percent of the total value of the settlement, a share "consistent" with other class-action cases.

"If attorneys are to continue to undertake environmental litigation on behalf of citizens, plaintiffs' attorneys must have the prospect of reasonable compensation," the lawyers wrote.

If Bedell approves the fee request, it would leave about $26 million for property remediation.

At trial, an expert for the residents had put the necessary remediation costs at $62 million, and the jury awarded property owners $55.5 million in cleanup costs.

So far, plaintiffs' lawyers and their proposed settlement administrator, Edgar Gentle of the firm Gentle, Turner and Sexton, have declined to publicly explain exactly how the remediation plan proposed at trial would be changed to cut its costs in half.

Gentle did say in a phone interview that the plan put forth by the plaintiffs at trial was a "Cadillac" cleanup. "Obviously, you can't do the same remediation," Gentle said. "It's not going to be a Cadillac because it's a settlement."

In court documents, the plaintiffs' attorneys said that the smaller amount for the cleanup "reflects the patent risks of litigation for the class.

"Specifically, in the event plaintiffs lost at retrial on the statute of limitations, the class would have recovered nothing," the lawyers wrote. "Alternatively, in the event plaintiffs were successful in whole or in part at the retrial, the class was surely facing another lengthy appellate battle and possible retrial (with a worst-case scenario of each class member having to testify in a mini-trial of his or her own).

"Either way, property remediation would not be happening for years, leaving class members continuing to be exposed to heavy metals and at increased risk of developing latent disease associated with that exposure," the lawyers wrote.

The plaintiffs' lawyers said that, once formally appointed by Bedell, Gentle as settlement administrator would "make some determination, with community input, related to the scope of a remediation consistent with the compromise settlement itself.

"The bottom line, however, is that once the settlement is approved, property remediation will actually happen and will begin sooner rather than later," the lawyers wrote.

Also, Bedell has not yet formally ruled on a motion by DuPont to create an independent settlement executive committee that could limit the actions and expenses by Gentle in running the medical monitoring program. The plaintiffs had proposed for Gentle to be part of the committee that would run the program.